thing-to-thing electricity micro- payments using
TRANSCRIPT
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Thing-to-Thing Electricity Micro-
Payments Using Blockchain
Technology
Thomas Lundqvist, Andreas de Blanche, H. Robert H. Andersson
Department of Engineering Science
University West, Trollhättan, Sweden
Global IoT Summit, June 2017
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Thomas Lundqvist, 20172
University WestTrollhättan
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Thing-to-thing micro-payments
Thomas Lundqvist, 2017
Characteristics:
• Small and numerous
• Autonomous
• Secure
• Private
• Reliable
Plug in cable-> Cable or appliance starts paying socket-> Socket starts delivering power
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Blockchain technology
Thomas Lundqvist, 2017
• Bitcoin, Satoshi Nakamoto, 2008
• Decentralized, open, peer-to-peer network
• No central trust:
o No single bank or company
controls the availability and use
• The blockchain database is a distributed
ledger
• Proof-of-work algorithm (mining) makes
the blockchain hard to rewrite
Status, June 2017:
1 BTC is $2500
Trade volume (24h) is 600,000 BTC(95,000 BTC on-chain)
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Bitcoin and micro-payments?
Thomas Lundqvist, 2017
Promising technology for thing-to-thing micro-payments:
• No central authority
• Reliable
• Interoperable
• Secure and private
• Easy account creation
o each thing can have its own account12,000 nodes
June 2017
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Purpose of study
Thomas Lundqvist, 2017
Examine the feasibility of using bitcoin in
autonomous thing-to-thing payments
Results:
• A proof-of-concept prototype system
• A new single-fee micro-payment protocol
• Limitations and possible pitfalls
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Proof-of-concept system
Thomas Lundqvist, 2017
We built a smart cable that connects to a smart socket
The smart cable pays the socket using Bitcoins for electricity
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8 Thomas Lundqvist, 2017
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Proof of concept
Thomas Lundqvist, 2017
We toasted one slice of bread:
• 1300 W toaster
• 40 Wh of energy
• 5 payment transactions
Total cost: 5 x 0.1 mBTC + bitcoin fees
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Bitcoin transactions
Thomas Lundqvist, 2017
Transaction
Input 5 BTCAccount 0Signature
Output 2 BTCAccount 2 public key
Output 3 BTCAccount 1 public key
Transaction
Input 3 BTCAccount 1Signature
Output 3 BTCAccount 3 public key
Unspent output
ECDSA: Elliptic Curve Digital Signature Algorithm
Offline account generation: public and private key
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One of the bitcoin transactions
Thomas Lundqvist, 2017
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Payment
protocol
design
Thomas Lundqvist, 2017
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The new
single-fee
micro-
payment
protocol
Thomas Lundqvist, 2017
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Trust considerations
Thomas Lundqvist, 2017
Trust issues:
• Cable tries to fool socket
• Socket tries to fool cable
Solutions:
• Payments should be small
• Cable must check transaction carefully before signing
• Socket must check transaction carefully before broadcasting
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Conclusions
Thomas Lundqvist, 2017
Micro payments using blockchain technology are feasible
The bitcoin blockchain has limitations:
• Too high relative fee for transactions
• Limited transaction capacity
Further obstacles:
• Account handling needs to be more user friendly
• Accounts must not be lost when things break
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Questions?
Thomas Lundqvist, 2017
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Technical considerations
Thomas Lundqvist, 2017
From prototype to production:
• Boot time should be faster: 27 sec to first payment in prototype
• Reliance on third-party API:
o Full node: 120 GB storage (June 2017)
o SPV-node: 35 MB storage (June 2017)
• Enough processing power is needed for crypto operations
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System states
Thomas Lundqvist, 2017